7 Jul, 2003
Luxury Hotels Group Sees Surge in Internet Bookings
One of the world’s most unique group of luxury hotels is reporting a sharp surge in bookings received directly over the Internet, and plans to grow those numbers further in the months ahead.
The Small Luxury Hotels of the World (SLH), whose 290 exclusive properties are frequented by the world’s rich and famous, has seen its Internet bookings increase from 1.8 % of the worldwide total in 1999 to 9.6 % in 2002. One property in Australia recorded receiving 44 % of its bookings over the Internet.
Lynne Ireland, SLH’s Regional Director for the Asia Pacific, attributed this to people becoming more familiar with the Internet, ease of usage as a booking tool as well as promotions by SLH itself. “People feel more in control and can do all the research they want,” she said.
While forecasting a doubling of the number in the next few years, she said SLH was working equally with the global distribution systems , travel agents and tour operators to boost bookings through them.
“It’s not a case of either/or,” she said. “We have to maximise bookings through all distribution channels.”
This, inspite of higher costs involved in handling bookings through the non-Internet channels because of the extra booking fees and commission payments.
SLH is a UK-based company that provides marketing and reservations services to its club of fashionable properties. The 60 properties in the Asia-Pacific include 14 in Australia, 11 in New Zealand, six each in Thailand and Indonesia, five in India, four each in Malaysia and the Maldives, two in Malaysia and the rest scattered through other countries.
Ms Ireland said she sees strong potential for additional properties in Sri Lanka, India, Vietnam and China. “We’re seeing that investors are moving away from building huge properties and focussing more on boutique hotels of the kind that we have,” she said. “There is a lot of interest in joining SLH.”
Members pay a joining fee of UK pounds 9,375 and an annual membership fee of UKP 8,000 for upto 20 rooms, with a supplement of UKP 125 per room up to a maximum of 150 rooms.
Members cannot be part of a global chain. The articles of association say SLH hotels are automatically considered to have resigned their membership should they join a chain.
“This is the heart and soul of SLH,” says Ms Ireland. “Members are passionate about their independence.”
However, the independence carries a price. SLH guests demand the highest possible quality and standards for which they last year paid a systemwide average room rate of US$ 290 per room per night, a figure which this year rose to US$ 325, Ms Ireland claimed.
Maintaining this quality means that owners of SLH hotels have to spend considerable amounts on product upkeep. Invisible inspections are carried out at least once in three years, and hotels can and do lose their membership if SLH board of directors deems that their standards have lapsed.
Last year, only 37 new hotels were accepted by the board, and an equivalent number rejected. Ms Ireland says many more didn’t even make it to the shortlist submitted to the board.
Once admitted to the club, owners also expect return on investment, especially as marketing activities are carried out largely on a user-pays basis.
Ms Ireland said SLH is working on a loyalty programme that will produce a formidable database of hotel guests who can be more specifically targeted by promotion campaigns.
The loyalty programme will have good potential for cross-linkage promotions with other industries which also target the rich and famous, such as the automotive industry (buyers of Lexus cars) and banks (private-banking facility clients).
“We are noticing more demand from them to have connectivity to their Internet sites,” she said. “They are using us as a tool to maintain the loyalty of their clients.”
In terms of product changes, spas are now becoming pretty much normal fare among the SLH properties. Now, Ms Ireland said there was a growing lifestyle trend for clients “to try and get more out of life.”
She said advance booking periods are shortening, now down to no more than a week or two. “People are becoming time-poor,” she said. “They are travelling more often but not necessarily spending less. They want more experiences, they want to get more out of life but at the same time they are more aware of their social and environmental responsibilities.”
At the same time, SLH members, too, are working to ensure that crises in the global tourism industry do not create such financial pressures that drive them into the hands of the global chains.
One positive side-effect of the recent terrorism and SARS-related crises, she said, is that regional communications and meetings have risen in line with a desire among members to share problems and exchange ideas on common ways to tackle them.
“They (the owners and operators) realise they are competing, but they also realise that there are synergies to be attained if they wish to maintain their independence.”
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